3 Signs Bitcoin Price Is Forming a Potential “Macro Bottom”
Bitcoin's bullish outlook is supported by at least three technical and on-chain metrics - but has the bottom been reached?
Bitcoin (BTC) may be bottoming out after gaining 25%, based on several market signals.
The price of BTC is up around 25% after dropping to around $17,500 on June 18. The upward retracement came after a 75% correction, measured from its November 2021 high of $69,000.
Daily BTC/USD price chart. Source: TradingViewThe recovery looks modest, however, and carries risks of continued downside due to prevailing macroeconomic headwinds (rising rates, inflation, etc.) and the collapse many top crypto companies like Three Arrows Capital, Terra and others.
But some widely followed indicators paint a different scenario, suggesting that Bitcoin's downside prospects from current price levels are minimal.
That big "oversold" bounceThe first sign of Bitcoin's macro bottom comes from its weekly Relative Strength Index (RSI).
Notably, BTC's weekly RSI became "oversold" after falling below 30 during the week of June 13. This is the first time the RSI has slipped into the oversold region since December 2018. Interestingly, Bitcoin had ended its bearish rally in the same month and rose over 340% over the following six months to reach $14,000.
In another instance, Bitcoin's weekly RSI dipped toward 30 (if not below) during the week beginning March 9, 2020. This also coincided with BTC's price bottoming out below 4,000 $ and then rising to $69,000 in November 2021 as shown below.< /p>
BTC/USD Weekly Price Chart with RSI - market background relationship. Source: TradingView
Bitcoin price has rebounded similarly since June 18, opening the door to a potential repeat of its history of parabolic rallies after an "oversold"...
Bitcoin's bullish outlook is supported by at least three technical and on-chain metrics - but has the bottom been reached?
Bitcoin (BTC) may be bottoming out after gaining 25%, based on several market signals.
The price of BTC is up around 25% after dropping to around $17,500 on June 18. The upward retracement came after a 75% correction, measured from its November 2021 high of $69,000.
Daily BTC/USD price chart. Source: TradingViewThe recovery looks modest, however, and carries risks of continued downside due to prevailing macroeconomic headwinds (rising rates, inflation, etc.) and the collapse many top crypto companies like Three Arrows Capital, Terra and others.
But some widely followed indicators paint a different scenario, suggesting that Bitcoin's downside prospects from current price levels are minimal.
That big "oversold" bounceThe first sign of Bitcoin's macro bottom comes from its weekly Relative Strength Index (RSI).
Notably, BTC's weekly RSI became "oversold" after falling below 30 during the week of June 13. This is the first time the RSI has slipped into the oversold region since December 2018. Interestingly, Bitcoin had ended its bearish rally in the same month and rose over 340% over the following six months to reach $14,000.
In another instance, Bitcoin's weekly RSI dipped toward 30 (if not below) during the week beginning March 9, 2020. This also coincided with BTC's price bottoming out below 4,000 $ and then rising to $69,000 in November 2021 as shown below.< /p>
BTC/USD Weekly Price Chart with RSI - market background relationship. Source: TradingView
Bitcoin price has rebounded similarly since June 18, opening the door to a potential repeat of its history of parabolic rallies after an "oversold"...
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